The Election Commission has been seeking to crack down on paid news as some politicians have been using the ruse to escape limits on poll spending. Photo: Mint

Updated: Sat, Feb 02 2013. 11 15 AM IST

New Delhi: The Election Commission of India (EC) has estimated the market in so-called paid news, or political advertising masquerading as journalism, at as much as Rs.500 crore.

The move is likely to buttress demands for greater scrutiny of election expenses. EC has been seeking to crack down on paid news as some politicians have been using the ruse to escape limits on poll spending. Apart from misleading voters during polls, the expense isn’t declared by candidates as electoral expenditure.

According to EC, around 40% of the election expenditure of political parties is earmarked towards publicity that includes media advertisements. Of the total amount paid to media firms, EC estimates half to be towards paid news.

“According to our internal assessment, we peg the paid news market in the country in the range of Rs.400 crore to Rs.500 crore. This is purely the paid news value and is not reflective of media advertising by political parties or candidates,” said a senior EC official requesting anonymity. Another EC official confirmed the internal estimates. “We look at a candidate’s expenses from the point of view of expenditure that is submitted to us,” the first EC official added.

While V.S. Sampath, chief election commissioner, declined to comment on the market valuation, he said, “As of today, paid news is not an electoral offence. This is the legal position. We have already proposed to the law ministry to make it an electoral offence. We are dealing with it from the point of expenditure.”

Earlier this week, The Hindu reported that several poll candidates had admitted to EC that they had paid newspapers for advertisements masquerading as news. The report added that none of the newspapers questioned by the Press Council of India (PCI) some time ago regarding election-related paid news admitted any guilt.

“As far as the media is concerned, PCI is a competent body to deal with any deviations. We refer such issues to the PCI,” Sampath said. PCI chairman Markandey Katju declined to comment on the story.

The paid news controversy gained momentum after The Hindu reported on 30 November 2009 that then Maharashtra chief minister Ashok Chavan had uitilized such advertising during his 2009 election campaign. The other high-profile case of paid news involves former Jharkhand chief minister Madhu Koda.

Under sections of the Representation of the People Act, a candidate is required to maintain an account of election expenses and ensure these do not exceed the prescribed limit. A candidate has to file expenses with EC within 30 days from the date of declaration of election results. If the expenditure is mis-stated, a candidate can be served a notice and disqualified for three years. If already elected by the time the scrutiny is complete, the person may lose the seat.

Mona Jain, chief executive at media buying agency VivaKi Exchange, said: “Election coverage in India is critical. If newspapers become biased, it’s bound to make readers sceptical and their loyalty will dwindle. However, since the manner in which this works is very covert, I’m not sure if readers are aware of this practice.”